Tuesday, July 19, 2011
Ideally you want a system in society, where people get opportunity to learn variety of subject matter, skills through education, work. Complementing that you also want people to learn about themselves. Learn what motivates them, learning drives genuine curosity in them. Ideal career would then be combination of skills that matches the natural temperament and aptitude of the individual. If the society as a whole can achieve this then country housing such societies would have no limits. Companies such as Google, Facebook, Investment banks have achieved such results. We just need to find a way to scale this.
Sunday, July 10, 2011
Themes driving weighting or sensitivities to each of the asset classes within a portfolio:
- The correlation of the asset class with other asset classes in the portfolio. Want lower correlations. E.g have equities and commodities in the portfolio. When equities are doing bad, the commodities are either steady or going up.
- What is the proportion of the asset class relative to the total market portfolio consisting of equities, fixed income, commodities, natural resources. Like to weigh more towards the expected asset class that will make up for majority in future.
- Expected return vs the downside risk. Assign more weight to asset class whose expected return is very high vs downside. E.g double down on equities/fixed income during the market lows of Oct 2008 or March 2009